A change is coming, and it’s called the NDC
Among the benefits of partnering with Tramada Systems for your travel data management is that we look after the technology – so that you don’t have to.
This is just as well, because few industries are subject to dramatic change as is the travel industry. Staying up-to-the-minute with new, emerging and over-the-horizon technologies and trends that have the potential to impact your business is a full-time responsibility but one which we gladly accept.
Tramada recently attended IATA’s AIR Business Travel Summit in Geneva, where the topic was squarely on one such trend and its underlying technology – the NDC, or New Distribution Capability.
One aim of the NDC is simple: to give TMCs access to features, options and content that until now have largely only been available on airline websites. By radically enhancing communications between airlines and aggregators, IT vendors, travel agents and others, the NDC promises to transform the way air products are retailed to corporations, and leisure and business travelers.
Delivering on that aim since it was first talked about back in 2012 has, however, has been slow and complicated. That’s because progress has required co-operation and co-ordination of all parties involved in air content distribution and the end-to-end booking process.
Industry momentum is building – rapidly
IATA’s vision – that 20% of content from 20% of carriers being distributed through the NDC by 2020 – is looking more and more achievable.
Today, more carriers are selling ancillaries — seat allocation, upgrades, fast-track boarding, on-board meals, etc. — through indirect channels that were previously only offered directly through their websites. Indeed, around the world nearly 60 leading airlines have now implemented the NDC in one way or another. Each implementation is different because the NDC is a technical standard, and not a standard way of doing business. For example:
- Lufthansa Group has introduced “NDC smart offers” featuring unique content, more ancillaries, and lower fares than those available from legacy distribution channels.
- British Airways is focusing on the NDC’s API to deliver rich content, and has already started developing dynamic pricing and content differentiation.
- American Airlines’ NDC strategy is focused on enhancing the customer experience. The carrier already counts the number of NDC transactions in the millions.
Not only airlines but right across the distribution value chain, the NDC is an industry trend enjoying widespread support. There are many examples of successful production implementations from IT solution providers such as OBTs, to TMCs and, importantly, all of the GDSs as well as airlines. Here are a few of the key aspects of the NDC’s adoption:
- A recurrent theme in any discussion about the NDC centers on how different players plan to address scalability challenges, such as handling huge volumes of data and managing increasingly complex transactions.
- Consider this scenario: an agent books an outbound flight segment using the NDC, but the return flight is booked via the GDS. Then, what happens if the ground transportation is booked by a third source? How does the agent get a holistic view and able to keep all elements in sync in the event the traveler wants to make a change?
- For the traveler who, as a result, may receive their outbound NDC-booked flight segment separately from other segments, such as their return flight, accommodation and ground transportation, it’s important that solutions are found that minimize the amount of documentation they receive, avoid duplication and errors, and, at all costs, eliminate any added stress.
- Among corporate buyers it is interesting to hear what multinationals are doing with the NDC. Bayer, for example, has rebuilt its corporate travel policy, basing it on the company strategy, while Microsoft’s approach is focused on its 80,000 travelers to better understand their needs, particularly those related to products and services.
- Other announcements from industry players indicate that potential hurdles, both technical and commercial, are being addressed.
What Tramada is doing
You don’t need to be a American Airlines or Microsoft to recognize the benefits of improving the way everyone works together – benefits such as faster innovation of products and, improved workflows, and the ability to build deeper relationships with customers by giving them a richer, truly personalized, transparent shopping experience.
Nor do you have to be technically minded to understand the nuts and bolts of solutions that carriers, user interface platforms, aggregators and IT providers are developing. As we said in the beginning, Tramada’s fixation on technology means you can concentrate on your core business, selling, with the confidence that we’ll help you reap the biggest benefits of the newest trends, today and tomorrow.
To be sure, 2018 is a tipping point for the NDC. It’s been called the “year of plumbing” – that is, when the industry moves beyond proof-of-concept to real-world, scalable and process-efficient solutions. This is precisely the approach Tramada is taking, with the goal of offering industry-leading booking automation capabilities regardless of booking channel, and scalability to handle large booking volumes and updates. Furthermore, we recognize that it won’t be an “either GDS or NDC”-approach in terms of booking channel, rather a long-term, viable solution that will cater for content booked via multiple channels at a booking level.
Keep an eye out for exciting announcements about the NDC from Tramada Systems soon. Meanwhile, for further information about this IATA initiative please click here.